The owner also needs to apply for the short-term rental license and you need to consider liability, damages and upkeep.

The previous response still applies, if 1) you owned the house for 2 years2) lived in the house for 2 years, You dont pay any taxes when you sell it.

Go on youtube and learn about creative financing techniques so you can understand what "tool" to use and how to apply it.

You should speak with an attorney about drafting up an agreement between the parties involved detailing the profit and equity percentage splits and your accountant will prepare the tax returns accordingly.

And I want to see what kind of options we have in regards to getting a mortgage (haven't applied for one in 20+ years)We currently live in a Townhouse (it's up to date) ARV is $250k +/- We are looking at Single Family Homes in the area at around $400k.

I don't really know how far into detail I want/need to be going on the entire deal - just the part that involves their money. 

An important quality I look for when working with Title Companies is their ability to problem solve, be dependable and responsive and have a polite and professional demeanor when interacting with me or anyone else involved in the transaction.  

but your right real estate can be transacted between parties don't need a lawyer or title or escrow company or agents or lenders or anyone but the two parties.. when foreclosure rescue lease back in our state was legal I did a ton of it.. and there simply was no time to involve anyone.. when the seller decided at 10am on Wednesday they needed to take Massive action and their foreclosure was scheduled for the next morning.. 

You are better dealing with the listing agent then having another involved. then you can work a better deal. agents / brokers rather not share their commission. 

He previously applied for a traditional home loan and was denied because it does not meet the secondary market requirements.